Tennessee to receive $26M following TVA board agreement

Thursday, April 14, 2011 at 1:17pm

Staff reports

Tennessee is expected to receive more than $26 million to fund energy conservation, alternative energy and/or pollution reduction projects following an agreement approved Thursday by the Tennessee Valley Authority Board of Directors, according to a release from the office of Gov. Bill Haslam.

The Tennessee Attorney General’s Office, on behalf of the Tennessee Department of Environment and Conservation, will join Alabama, Kentucky and North Carolina in filing the agreement in the form of a consent decree, resolving years of allegations that TVA violated the Clean Air Act. A coalition of citizen groups filed their own complaint, which will be consolidated with the states’ complaint, allowing the citizen groups to join in the agreement with the states, according to the release.

Tennessee’s agreement coincides with an agreement being filed Thursday between TVA and the U.S. Environmental Protection Agency (EPA). The utility will pay the states and the EPA a combined $350 million to fund environmental projects, as well as $10 million in civil penalties. The $350 million is payable over the next five years, and the civil penalties are payable 30 days after the date the agreement is entered by the court. Tennessee will receive the largest state’s share, $26.4 million for environmental projects and $1 million in civil penalties.

“This agreement is important in not only making our air cleaner but it also helps to provide predictability for TVA and its commercial users,” Haslam said in the release. “This certainty will assist in economic development efforts in the state and region and is a complement to our efforts in making Tennessee’s business climate as attractive for investment as possible.”

The agreement calls for TVA to make improvements throughout its system to reduce air emissions. Specifically, the utility has agreed to reduce air emissions from its 11 coal-fired power plants and retire 18 older units. Ten coal-fired units will be retired at the Johnsonville plant in New Johnsonville, two units at the John Sevier plant in Rogersville and six units at the Widows Creek Fossil plant in North Alabama.

For several years, TVA been working to update plants with new air pollution control measures and has plans to implement new emissions controls as part of the agreement. The agreement stipulates that emissions such as nitrogen oxides and sulfur dioxides will be reduced by more than 48,000 tons per year and 208,000 tons per year, respectively.

“Today’s agreement is the largest of its kind to date,” Attorney General Bob Cooper said. “We are pleased to have helped negotiate this collaborative agreement to resolve this enforcement action that will yield cleaner air and support economic development in our state as well as that of our neighboring states. We appreciate the TVA board’s approval of this resolution.”

Tennessee will file its lawsuit and the consent decree embodying the agreement in the U.S. District Court in Knoxville now that the TVA Board of Directors has approved the agreement, which was done during the body’s regular board meeting in Chattanooga Thursday.

In addition to the court agreements with the EPA and other states, the case will conclude actions by the National Park Conservation Association, the Sierra Club and Our Children’s Earth Foundation.

The consent decree lodged with the court by the states and the citizen groups, and EPA’s agreement with TVA, will be available for public review and comment for 30 days.